Minutes - draft

Please note these minutes are currently draft and are subject to committee approval.

Minutes of the meeting of the Finance Committee held on 17 February 2005 at 10 Dean Farrar Street, London, SW1H 0NY.

Present

Members

• Graham Tope (Chair)
• Richard Sumray (Deputy Chair)
• Reshard Auladin
• Bob Neill (from agenda item 6 onwards)
• Rachel Whittaker. Tony Arbour also attended

MPA officers

• Peter Martin (Treasurer)
• David Riddle (Deputy Clerk)
• John Crompton (Committee Services)

MPS officers

• Sharon Burd (Director of Finance Services)
• Terry Price (Director of Strategic Finance)
• Craig Watkins (Director of Business Development
• Alan Croney (Director of Property Services)
• Philip Scutchings (Group Director of Technology Directorate of Information)
• Derek Rothwell (Director of Outsourcing and Infrastructure)
• Paul Daly (Director of Exchequer Services attended for consideration of items 9 and 15

122. Apologies for absence

(Agenda item 1)

Apologies for absence were submitted on behalf of Richard Barnes and Elizabeth Howlett.

123. Declarations of interests

(Agenda item 2)

No declarations were made.

124. Minutes of the meeting held on 20 January 2005

(Agenda item 3)

It was agreed that the following information be appended to the minutes of this meeting and also be circulated to members:

Minute 110 Annual Review of Fees and Charges - more information about the phasing in of those charges which differ greatly from those in the ACPO guidelines

Minute 112 Estates Update - outstanding request for information on the duration of the matched funding for the key worker housing scheme.

Resolved: That subject thereto the minutes of the meeting held on 20 January 2005 be agreed and signed as a correct record.

125. Chair and Members’ update

(Agenda item 4)

The Chair referred to the fact that this was the last meeting of the Finance Committee that Peter Martin would be attending as Treasurer to the Authority. He paid tribute to the enormous contribution Peter Martin had made since the Authority was established and on a personal basis said he had enjoyed a very good working relationship with him. On behalf of the Committee, the Chair extended best wishes to Peter for the future. Peter Martin returned his thanks.

126. Revenue and capital budget monitoring 2004/05

(Agenda item 5)

A report was submitted which provided an update on the performance against the revenue budget as at the end of December. The overall year to date position is an underspend against budget of £4.3m and a forecast underspend at year-end of £6.9M. Expenditure on capital to date totals £94.0M. The forecast for the year is £40.6M below budget.

Revenue

In relation to the additional costs arising from the MPS response to the tsunami disaster in SE Asia the Treasurer advised that a framework was now emerging concerning the reimbursement of expenditure from central government. The Director of Business Development also reported that the Home Office had confirmed that police forces would receive reimbursement for their participation in the forthcoming Atlantic Blue exercise.

Reshard Auladin referred to the tendency each year for the police staff budget to be over-budgeted and for surplus sums to be used to off-set extra over-expenditure elsewhere. He said It would be advisable for the budget for the new financial year to be closely examined and to consider withholding monies if the Committee was not satisfied that a budget line was not realistic. The Director of Business Development advised that business groups were asked to set realistic budgets for police staff.

Other members agreed that it was important that all budgets were accurate although the withholding of monies might not necessarily be the most appropriate way of addressing the issue and might have a negative impact on the move towards greater budget devolution.

It was noted that a report would be submitted to the Authority at its meeting on 31 March which set out details of its allocation within the MPS and any inter-group budget changes. The Chair suggested that a meeting of the Budget and Police Overtime Review group be held shortly before the meeting to enable members to consider the report.
The Director of Business Development advised that information would be provided at the next meeting on items included in the list of revenue savings where the savings had exceeded the required level. The Committee also asked that a future report should contain information on the management controls for budgets.

Capital

A revised version of Appendix 5 was tabled.

The Director of Business Development referred to paragraph 26 and explained that it had been established that it was no longer necessary to make a capital movement in respect of C3i. There would be a report to a future meeting on the estate aspect. The only budget movement, which the Committee was being asked to agree was £2.2M in respect of Transport Services which meant that the figure for the revised capital budget shown in the summary in paragraph 27 was £213M.

Resolved – That

1. the revenue and capital performance against budget to date and the latest revenue and capital forecasts for the year be noted;
2. it be noted that capital approved budget movements have been increased to include £18.2 M of previously approved movements;
3. it be noted that capital budget movements of 5.6M have been made under delegated authority;
4. a capital movement of £2.2 M. in respect of Transport Services be authorised; and
5. a meeting of the budget group be arranged to give preliminary consideration to the report on the allocation of the 2005/05 budget to be considered by the Authority at its meeting on 31 March 2005.

(Note – the budget group meeting was arranged for 23 March)

127. Budget 2005/06 update

(Agenda item 6)

The Treasurer reported that following the London Assembly meeting on 14 February, the Mayor’s final budget proposals were now approved. As part of the process, the Mayor had made certain undertakings. The one that was most relevant to the MPA and MPS concerned additional resources for road safety policing. The Authority had been advised of the outline of the mechanism for doing this under which Transport for London would pass over monies received by them as additional revenue from red route policing. The Treasurer said that clearly the MPS would need to consider the detailed workings of this arrangement and the precise functions the money would be applied to. He thought that it might be several months before any monies were actually remitted under this new arrangement.

At the meeting of the Coordination and Policing Committee, held after the dispatch of the agenda for the Finance Committee, a report was commissioned which set out the implications for the budget on decisions made concerning the Resource Allocation Formula. The Committee agreed to consider this additional report. The Director of Strategic Finance confirmed that the proposals contained in the report had been notified to the members of the MPS Management Board.

The Committee felt that the items identified in the table at paragraph 8 should be deleted from the budget rather than frozen as stated in the preamble. Consideration of their reinstatement would have to be taken in conjunction with the other budgetary pressures evident at that time.

Referring to the table at Appendix 1 Richard Sumray said it was not appropriate or necessary for there to be a budget line in respect of the 2012 Olympics and it was agreed that this be deleted.

Bob Neill said he did not consider that the report contained sufficient information for the committee to agree the proposed changes and Rachel Whittaker said she wished to make the point that as Chair of the Human Resources Committee she had not been consulted on the proposals regarding the reductions which affected training and therefore was not aware of the consequences they might have.

Resolved – That (with Bob Neill dissenting) the changes to the 2005/06 budget listed in paragraphs 8 and 9 be agreed on the basis that the items at paragraph 8 be deleted from the budget.

128. Efficiency plan monitoring – as at third quarter 2004/05

(Agenda item 7)

This report sets out the forecast position against the MPS’s efficiency plan as at the end of the third quarter.

Resolved – That the position against the efficiency plan be noted.

129. Provisional MPA efficiency plan 2005/06 and future years

(Agenda item 8)

This report set out the financial aspects of the MPA’s efficiency plan for 2005/06

Resolved – That the provisional plan be approved and the process for providing in-year updates be noted.

130. Approval to award a contract for the provision of payroll and pension administration services

(Agenda item 9)

This report sought approval to award a contract to LogicaCMG for the provision of outsourced payroll and pensions administration services commencing on 1 April 2006. It gave an outline of the procurement process and explains the economic and commercial rationale behind the recommendations.

In reply to questions the Director of Outsourcing and Infrastructure confirmed that TUPE considerations would not apply to any MPS staff. He also advised that the possibility of entering into a joint procurement exercise with other parts of the GLA family for the provision of this service had not been explored.

The Committee considered that there could be advantages in such an approach and requested that this option be explored during the lifetime of the new contract. The Deputy Clerk suggested that the Greater London Authority Chief Executives group might also discuss the wider question of taking advantage of economies of scale and synergy across the group on other common functions and activities.

Resolved – That

1. approval be given for the award of a contract for the provision of payroll and pensions administration services to LogicaCMG to commence on 1 April 2006 for an initial duration of seven years, with the option to extend for a further three years; and
2. it be noted that acceptance of this recommendation will constitute approval to proceed with contract signature and implementation of the current supplier exit plan and transition plan to the new service provider.

131. Review of residential rents and service charge

(Agenda item 10)

A report was submitted which requested the Committee to determine the level of rent increases for 2005/06 that is to be paid by officers who live in MPS residential accommodation. The Committee noted that in the preamble to the recommendation the year should read 2005/06.

The Director of Property Services reported that the Police Federation had stated that they had no comment to make on the proposals. He also explained that the MPS Management Board had supported the proposals.

Members referred to the proposal to identify a section house for closure and said that it did not make sense to consider this suggestion in isolation from other alternatives for section houses and in turn, decisions concerning section houses should only be considered as part of the overall strategy for the residential estate. The Committee requested that a report on the residential estate strategy be submitted as soon as possible.

Resolved – That

1. the rents on residential quarters be increased by 3% as from 1 April 2005:
2. the service charge on section house bed spaces be increased by 3% as from 1 April 2005; and
3. any decisions with regard to the future of section houses be taken as part of the Committee’s consideration of the residential estate strategy at a future meeting.

132. Managed service contract for evidential analysis

(Agenda item 11)

A report was submitted concerning the award of a contract to meet the growth and demand for the analysis of electronic devices and systems, which exceeds the capacity of the existing in-house and external service. The proposal is part of the modernisation programme of the Directorate of Information Evidential Analysis Laboratories to ensure the service provided is affordable and delivered to an agreed timetable.

Resolved – That approval be given to the award of a contract on a call off basis to Berkley Business, CCL, Control Risk, FSS, FTS, IBAS, Kalagate, LGC and Qinetiq for a three-year period with a possible two year extension.

133. Exclusion of press and public

(Agenda item 12)

As all the reports were dealt with in the public part of the agenda the motion to exclude the press and public was not considered. The information in the reports is still exempt.

Summary of decisions made on exempt items

Minute 134 agenda item 13 – exempt Appendix to Managed Service Contract for Evidential Analysis
The information was noted.

Minute 135 agenda item 14 – Outsource services programme – quarterly update
The information was noted.

Minute 136 agenda item 15 – Exempt Appendix to approval to award a contract for the provision of Payroll and Pension Administration Services

Minute 137 agenda item 16 - exempt minutes of the meeting held on 20 January 2005
The minutes were agreed and signed as a correct record.

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